EMC 2009 Annual Report Download - page 89

Download and view the complete annual report

Please find page 89 of the 2009 EMC annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 144

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144

Table of Contents
EMC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
The activity for each charge is as follows:
2008 Restructuring Programs
The activity for the 2008 restructuring programs is presented below (table in thousands):
2009
Category
Beginning
Balance
2009 Charges
Relating to
the 2008 Plan Utilization
Ending
Balance
Workforce reductions $ 186,274 54,416 $ (156,424) $ 84,266
Abandoned and impaired assets — 6,203 (6,203) —
Consolidation of excess facilities and other contractual obligations 2,376 26,379 (23,870) 4,885
Total $ 188,650 $ 86,998 $ (186,497) $ 89,151
2008
Category
Initial
Provision
Utilization
During 2008
Ending
Balance
Non-Cash
Portion of the
Provision
Workforce reductions $ 201,016 $ (14,742) $ 186,274 $ 1,330
Abandoned and impaired assets 49,774 (49,774) — 49,774
Consolidation of excess facilities and other contractual obligations 5,748 (3,372) 2,376 —
Total $ 256,538 $ (67,888) $ 188,650 $ 51,104
The remaining cash portion owed for these programs is approximately $69 million. The cash expenditures relating to workforce reductions are expected
to be substantially paid out by the end of 2010. The cash expenditures relating to the contractual obligations are expected to be paid out by the end of 2015.
R. Related Party Transactions
In 2009, 2008 and 2007, we leased certain real estate from a company owned by a member of our Board of Directors and such Director's siblings, for
which payments aggregated approximately $4.8 million, $4.1 million and $3.7 million, respectively. Such lease was initially assumed by us as a result of our
acquisition of Data General in 1999 and renewed in 2003 for a ten-year term.
In 2007, VMware entered into an agreement to license software from a third party. A member of our Board of Directors is a managing partner and
general partner in a limited partnership which, until November 2009, had an equity interest in such third party of greater than 10%. The amounts expensed or
paid to such third party in 2009, 2008 and 2007 were not material to our Consolidated Financial Statements.
In accordance with its written policy and procedures relating to related person transactions, EMC's Audit Committee has approved each of the above
transactions occurring since the policy's adoption.
EMC is a large global organization which engages in thousands of purchase, sales and other transactions annually. We enter into purchase and sales
transactions with other publicly- and privately-held companies, universities, hospitals and not-for-profit organizations with which members of our Board of
Directors or executive officers are affiliated. We enter into these arrangements in the ordinary course of our business.
From time to time, we make strategic investments in privately-held companies that develop software, hardware and other technologies or provide
services supporting our technologies. We may purchase from or make sales to these organizations.
We believe that the terms of each of these arrangements described above were fair and not less favorable to us than could have been obtained from
unaffiliated parties.
87